The 80/20 Rule (also known as the Pareto principle) states that, for many events, roughly 80% of the effects come from 20% of the causes.

In recent history, this rule has certainly proven to be true in Sales. For decades, approximately 80% of sales have been produced by 20% of salespeople.

While a very small percentage of owners have addressed this daunting issue and created a more effective team using time-tested sales, sales management, assessment, and sales recruiting best practices, the vast majority of business leaders simply exacerbated the problem by spinning wheels and spending too much time with non-performing reps, while coddling their top performers.

The 80/20 sales ratio is about to change. Here’s why:

• Buying behavior has changed.
• Margins are being squeezed.
• Sales Cycles are becoming much longer.
• All Sales Teams are now remote. They will remain primarily virtual for the foreseeable future.
• Many companies are downsizing their salesforces.
• High unemployment and reduced spending will weed out many of the weak and average salespeople, leaving only the best ones.
• Unfortunately, most of the “average” or “good” reps will not possess the skills to grow sales, increase market share, and maintain margins. They will flounder.

2017 - 2019 studies indicate than 55% of sales reps produce a negative ROI, and over half of all newly hired reps do not last a full year with their employer; and these studies were conducted during the most prosperous economic times.

In just a few short months, the pendulum has swung 180 degrees from a Seller’s Physical Market to a Buyer’s Virtual Market.

To compound the lack of skills among salespeople, the vast majority of sales managers are unskilled when it comes to effective coaching and managing a virtual workforce.

Despite the fact that some of the most talented salespeople will finally be available and seeking new employment, most companies are still clueless when it comes to effectively locating, landing, and launching the great ones.

We are all now playing a totally different game, one that requires a highly consultative sales process, advanced organizational, listening, and social selling skills, superior mental toughness, and empowering Sales DNA.

Less than 5% of sales reps possess all of these skills.

Before 2020, one-fifth of salespeople generated 80% of the results. Going forward, we can fully expect the 80/20 ratio to look more like 95/5.

Think hard about this. The Top 5% will not win 80% of the profitable business, they will win almost all of it. The top 25% will take some low margin business. The rest will get only the spoils.

If your sales team is currently on fire and setting new records, congratulations! If not, you may want to seriously consider taking a hard look at the skill level and pipeline viability of your salespeople (and managers), and to honestly assessing whether or not they have what it takes to provide your company with a significant ROI. You can then decide whether or not it makes sense to make some adjustments.

Here’s the good news (I know it took a while to get here)…

The combination of predictive science, effective processes, and a very high (and perhaps short-lived) unemployment rate present a very unique, perhaps once-in-a-lifetime opportunity for you to rapidly and dramatically upgrade your sales team, allowing you to produce much more with less. 

Copyright © Joe Zente 2020. All Rights Reserved.

Many businesses will begin to re-open over the next few weeks. While there is certainly no shortage of opinions of the pros and cons of the timing, guidelines, and regulations, there seems to be many more questions than answers with regard to the speed and trajectory the economy will take from here, and the best success strategies for the rest of 2020 and beyond.

We do know for sure that selling has changed. While most salespeople tend to be optimists, it is highly unlikely that most will return to their pre-Covid19 activities, returning to their offices and territories and business as usual. There are many reasons for this, but here are just a few:

1. Efficiency:  Time is all salespeople have. It is their best asset. Reps that invest their time skillfully succeed, those that don’t fail. It does not take a rocket scientist to quickly figure out that field salespeople burn up tons of time, and that salespeople selling virtually via videocom can visit with 2 to 4 times more prospects per day that those travelling around in their territories.
2. Costs:  Again, it doesn’t take Einstein to conclude that selling virtually can save a lot of money.  Cars, maintenance, airfares, hotels, meals, and parking can cost a needless fortune.
3. Coverage:  Geographical positioning and placement has always been a challenge for sales leaders and hiring managers. With virtual selling, this challenge basically evaporates.
4. CRM: Since the advent of digital tracking systems, salespeople have been notorious for devising creative excuses for not updating their CRMs.  The majority of these excuses took some form of “too busy”, “on-the-road”, “lost connectivity”, or “away from my computer”.  Virtual selling removes nearly 100% of CRM compliance excuses.
5. Your Customers & Prospects: Even if you and your salespeople DO want to return to face-to-face meetings, you can probably expect that a large percentage of your prospects and clients may PREFER to communicate via videoconference.  Some will even mandate it.
6. Children: If your salespeople are ready and committed to get back in the saddle and hit the road to make sales calls, keep in mind that most kids will be home for the rest of the school year.  It is also doubtful that they will be attending summer activities like camp, and many may not be returning to school in the fall. If the kids are home, your salespeople will likely need to be home as well.

In other words, virtual selling may become a necessity — perhaps for a while, and maybe forever.   Is your company ready?

Re-shaping and upgrading your Sales Team for a Better Normal starts with a comprehensive understanding of the skills, strengths, DNA, and mindset required to succeed in the new selling environment.

While the post-Corona selling era and situation will present huge challenges for most businesses, any wise owner can quickly convert these challenges into a big opportunity. While most will fail, some salespeople and managers WILL succeed beyond simple survival – they will dominate.  I outlined some key success requirements in last week’s blog. Here are a few more critical factors to consider as you formulate your BETTER Normal Sales Strategy…:

• Only 15% of salespeople have the questioning and listening skills requires, and only 5% have mastered all the consultative selling competencies.
• Only 31% of all salespeople have the ability to thoroughly qualify an opportunity.
• Only 41% have the ability to sell value.
• Only 41% have the skills & strengths necessary to work from home, and only 7% of sales managers have the coaching skills necessary to develop a remote sales team!

Despite the fact that selling has been relatively simple for the last 3 years, less than half of salespeople were able to achieve quota. With selling freezes, demanding buyers, longer sales cycles, and more, it has never been more important for your salespeople and manager(s) to maintain margins.

The good news is that you have science and predictive validity in your arsenal.

If you’d like to learn more about which of your team members possess the skills to grow your business, maintain strong margins, and fill these various new, demanding sales roles, feel free to email me or click here.

Continued Success!

Joe

Copyright © Joe Zente 2020. All Rights Reserved.

In the beginning of March, the selling landscape changed Big Time.

For most of the last three or four years, nearly every phase of the economy was humming. Selling was easy.  New economic records were continuously being set, and even sub-par sales reps were occasionally making quota.

Those days are now gone — for the near term, and perhaps for many years. Buying behavior has changed dramatically, so only the strongest (salespeople) will survive. Going forward, here’s what you can expect:

• Order takers are now Toast.
• “Average” sales reps will have little to no chance of prospering in the New Normal.
• Buyers will chew up Convinc-aholics, over-promisors, give-away artists, and demonstrators.  They will delay purchases and negotiate sales-weaklings into price discounts and all sorts of expensive concessions.
• Although some salespeople may increase their volume of proposals, sales conversion rates, revenues and profit will all drop dramatically. Forecasts will become less and less reliable, frustrating the reps, their managers, and company leadership.
• Sales cycles will become considerably longer.
• Under these intense conditions, unskilled salespeople will surrender all control and embark in a frantic race to the bottom.
• Only hyper-committed, mentally tough, highly consultative salespeople will have any potential to generate business and maintain margins.  Less than 5% of all sales candidates possess these attributes.
• While the vast majority of sales reps will engage in price wars and bake-offs, ineffectively trying to protect any semblance of margin, the elite 5% will consistently facilitate discovery and challenge the status quo, differentiating themselves and changing buyer’s visions to win more sales and maintain margins.

While much of this may sound catastrophic, this combination of circumstances actually represents massive opportunity for those owners that act swiftly and skillfully.  Let me share a few other facts:

• Unemployment was hovering between 3 and 4% during most of 2018 and 2019.  During this time, it was extremely difficult and very expensive to woo an elite salesperson away from their company.
• Consequently, many companies tolerated even more mediocrity than usual on their respective sales teams.
• Millions of Americans, including plenty of sales reps, have filed for unemployment in the last month. 
• Finally, many elite salespeople are looking, and looking hard, to find a new home.  
• These salespeople are highly skilled at hunting and closing, so they won’t be around for long. In other words, you snooze, you lose.
• Now is an ideal time to eliminate mediocrity, hire superior sales talent, and upgrade the players, effectiveness, culture, and productivity of your Sales Team.

Those 5% of salespeople who have mastered consultative selling possess a unique combination of skills, strengths, and beliefs/mindset (aka: Sales DNA). Some of the most important qualities include questioning & listening skills, business/financial understanding, proper tone, and intense enthusiasm for selling. Elite salespeople also lack a need for approval, effectively control their emotions, are comfortable discussing money, understand how to accumulate vital knowledge before & during the sale, and follow an effective sales process. In the new normal, (and depending upon their specific role) a salesperson may also require the skills to effectively sell remotely, as videocons and similar interactions will likely increase.

Fortunately, there is a highly predictive science to sales force selection and an objective, time-tested Locate, Land & Launch process of attracting, hiring, and on-boarding sales superstars.

There is always both danger and opportunity in every crisis. From a growth and profit perspective, a lack of action will create extreme danger, as only superior sales organizations will survive the next several months and thrive into 2021 and beyond. Forward-thinking leaders will take action now to position themselves to capture market share today and to dominate their competition tomorrow.

Best Wishes for your continued safety, health, and prosperity.

Copyright © Joe Zente 2020. All Rights Reserved.

Z3 and TAB Austin welcomes guest contributor, our own TAB Certified Facilitator/Coach Jim Gerberman.

I have the privilege of being part of a group of TAB business owners and leaders who meet routinely to help each other with issues and challenges related to pursuing their business and personal purpose. At a recent monthly meeting, one of our team presented each of our members with shirts that he had discovered during a trip to Hawaii. He shared the “Red Dirt Shirt” story as an example of a resilient business owner that had found success from a catastrophic event.

On September 11, 1992, the Hawaiian island of Kauai was devastated by Hurricane Iniki.  According to their company website: “Among the businesses affected was our small screen print shop. All of our white shirts waiting to be printed were drenched with water and stained with Red Dirt blown in from the storm. Instead of throwing out the shirts, we decided to dry them as they were. The T shirts, stained with the ultra iron rich Red Dirt soil and printed with Hawaiian based themes became a hit with locals and visitors alike.” Today, the Red Dirt Shirts company has seven locations in Hawaii, Arizona and Utah and produces and sells more than 100,000 shirts per month.

Rather ironically, on the same day that our team received these shirts, an article in The New York Times reported that “China Identifies New Virus Causing Pneumonia like Illness”. Three days later, on 11 January, Chinese state media reported the first known death from an illness caused by the coronavirus.

A relevant question for each of us: “Is there a Red Dirt Shirt story for you and your business in this time of unprecedented uncertainty?” And: “How might one identify and pursue such opportunities?”

I really like the suggestions recently shared by Mark Cuban:

• Experiment with new ideas. Since you have holes in your schedule, it’s a great time to experiment with new lines of business and see what sticks. He also recommended brainstorming not only with your peers, but also with your competitors. They are all in the same boat. Try to figure out the best way to reignite the industry.
• Really get to know your employees. Take the time to understand the individual circumstances of your employees and their families.
• Clean up parts of the business you’ve been neglecting or haven’t had time for. Control what you can control. Rather than focusing on how bad it is, focus on how you can use this time to connect with your future customers.

A final thought from an article shared by a friend: “Crises teach us that CEOs aren’t expected to be as right as they are expected to be engaged”.

Stay safe. Stay healthy. Stay engaged.

Copyright © Jim Gerberman 2020.  All Rights Reserved. 

Successful business leaders know that fortunes are often made during times of crisis and uncertainty.

The Coronavirus, plummeting oil prices, political & foreign policy jockeying, media hype, and a growing sense of global chaos have created an interesting, but not entirely uncommon, business environment. How can we behave in a calm, focused, and skillful manner when so many are beginning to panic? How can we keep growing sales during unpredictable times that delay or paralyze decision-making?

We have been here before. During my life, I’ve experienced six or seven recessions and perhaps three times as many major public health scares.  These kinds of crises cause widespread pain that should be addressed with seriousness.  With that said, the way the most effective business and sales leaders have historically dealt with these events was often diametrically opposed to the majority. Unlike so many who became consumed with fear and paralysis, superior leaders evaluated markets, their people, their plans, true risks, and emerging upside potential.  They looked closely at how their offerings might fit into the New Normal (aka: perceived reality), refocusing efforts to attack the changed marketplace in a proactive, positive manner.

Most people suspect that 2020 will long be remembered as a period of significant change. The best leaders view significant change as an opportunity to become stronger. These types of environments represent a major Sales opportunity to strengthen relationships with new and existing clients. As a salesperson, the most difficult times are the most ideal to differentiate yourself from your competitors.

Selling in prosperous times is simple.  It’s during the toughest times that premier salespeople really shine.

For many, uncertain times create all sorts of speculation, assumptions, prognostication, drama, stress, and sometimes panic (all things you should avoid).  However, if we are to prepare ourselves for success, we do need to face the brutal facts. During the next few quarters, and until the feverish levels of confusion and volatility begin to wane, most salespeople can expect major changes in Buyer Behavior. Many buyers will behave differently with regard to decision speed.  For most, the decision process will slow down, but for some, urgency will actually speed up to unprecedented levels. We can also expect changes in what people need and how much they need.  Finally, expect a slew of changes in decision criteria.

Before jumping into some specific actions to grow sales during tough times, it is important to note here that the MOST important thing to address is not words, scripts, messaging, or activities.  The single most important component that will separate top performers from the pack in Sales is MINDSET. While a salesperson’s mindset is always critical to selling success, their beliefs, attitudes, perceptions, and self-talk are especially crucial when uncertainty abounds.

So let’s get going. You can start here…:

Sales Leaders & Managers:

• Where are you?: Audit your current sales strategy.  Beware of sacred cows, and be willing to crack some eggs.  Does your current strategy really address the new marketplace effectively?  What needs to be changed? 
• Segment Markets:  Has the New Normal created any major areas of concern for your prospects and customers? Now is the best time to contact all of your existing customers to show them how much you care, to learn what THEY are doing to weather the storm, and to evaluate whether or not there is anything you might do to help.
• Consistency:  If there is anything at all that is changing about your messaging or value proposition, make sure that everyone on your sales (and marketing) teams are speaking the same language.  This is no time to add any additional confusion to an already uncertain marketplace. During turbulent times, most people openly welcome messages of confidence and stability. Be their ROCK.
• Sales Process & Plan:  Great salespeople are always in demand, but are in even greater demand when times become uncertain. Today, your salespeople will likely be getting more “NOs”, more delays, and more rejection.  To keep them persistent and motivated, show them your appreciation, and provide them with the tools they need to be confident, resilient, and productive.  Those who power through will emerge stronger than ever. Ensure your Sales Team has an effective, consistent, consultative sales process that works.
• Sales Training & Coaching: Support your salespeople with the training they need to stay focused, recognize opportunities, and grow sales.

Salespeople:

• Your Plan:  Review your current sales plan.  Make sure it aligns with the updated company sales strategy. Adjust where required, then get after it.  And remember, spend most of your time LEARNING. The market has likely changed (on both a collective and individual client basis), so your consultative sales interviews should include a massive component of market research.
• Client account review:  Start with your existing customers. Seek to understand. Learn about each of their concerns. Is there anything you might do to help? Many will openly embrace support in deciding how to navigate in these uncertain times.  Be their go-to trusted advisor.
• Don’t wait for the phone to ring: Many people will become paralyzed during these times. Personally contact as many prospects and clients as possible. Call them, get in front of them.  Try not to hide behind email (you’ll lose the opportunity to LEARN). Don’t feel like you need to solve anything or propose solutions.  It is OK to not have all the answers, but if you can help your clients develop better questions or make better decisions, you will add a lot of value.  They will remember you for it (and you will learn a lot about the market and see new potential opportunities).
• Care, Listen, Understand: What concerns your clients and prospects?  Don’t listen with an intent to sell.  Listen with an intent to Learn.  Keep your filters off.  This is no time to don’t be pushy or convincing.  Be patient.  If you are, I promise your consultations and empathy will produce plenty of new opportunities.
• Get in the Right Room: Fear is contagious.  So is drama, doom, and gloom.  The sky is not falling. Surround yourself with other positive, realistic professionals. Separate facts from fiction and don’t be afraid to challenge conventional wisdom.  Innovation and productivity are also contagious. Choose your party carefully.
• Persistence:  Never give up.  Understand that opportunities always abound during uncertain times, but that most people simply do not recognize them.

Never forget, the psychology of buyers, and principles of effective selling and communication apply during good times and bad. But during very uncertain times, superior salespeople and teams understand how to be even more valuable to their clients and their companies by unearthing new opportunities and by helping their prospects see new ways to approach an otherwise scary environment.  By being persistent, talking less, and learning more, they completely separate themselves from the pack.

Helping a client protect and improve their own business is always a much greater differentiator than offering a product or service itself. Salespeople that approach conversations in this manner will always get preferential treatment when the time comes for a purchase decision.

Continued success,

Joe

Copyright © Joe Zente 2020.  All Rights Reserved.